ConvaTec aims to operate at all times with the highest standards of integrity. Doing what is right and challenging what feels wrong, no matter what the issue or circumstance, are part of our core values.
We are committed to preventing slavery and human trafficking and implement policies and processes to prevent, assess, detect and report violations within our own operations and our supply chains. This statement which is published in accordance with section 54 (1) of the Modern Slavery Act 2015 outlines our approach during the period 1 January 2020 to 31 December 2020.
OUR BUSINESS AND STRUCTURE
We have a clear vision – Pioneering trusted medical solutions to improve the lives we touch. This statement, which encapsulates our purpose and our ambition, lies at the heart of everything we do. This vision, and the following values, determine how we run our business every day.
How we run our business in a responsible way is summarised in our 2020 Annual Report and Accounts which can be viewed here.
We are focused on the chronic care market, with established positions in advanced wound care, ostomy care, continence and critical care and infusion care. We develop and manufacture innovative products that give people living with chronic conditions confidence, freedom and mobility. We also offer a range of services to support these people and the healthcare professionals who care for them.
We market and sell our products and services in over 100 countries and own and operate nine manufacturing plants located in seven countries: the UK, three within the EU (Denmark, The Netherlands and Slovakia) plus Belarus, the Dominican Republic and Mexico. Our reported revenue for 2020 was $1,894m, split geographically as follows: Europe, Middle East & Africa ($731m – 38.6%), Americas ($1,015m – 53.6%), and Asia Pacific ($148m – 7.8%). Our Group structure includes over 50 active companies. This statement is relevant to all our active companies including the following three active companies which are located in the UK: ConvaTec Group Plc, ConvaTec Limited and Amcare Limited.
We market and sell our solutions and services in four categories, as described below. We have a direct presence in certain markets and an extensive network of wholesalers and distributors.
Further information about our business, markets, products and financial performance is included in our 2020 Annual Report and Accounts which can be viewed here.
OUR SUPPLY CHAINS
Our supply chains include companies based in all parts of the world, including but not limited to China, Taiwan, U.K., U.S.A., Canada, Denmark, Slovakia, Belarus, Italy, Switzerland, Sweden, France, Ireland, Spain, Poland, Turkey, Russia, Germany, The Netherlands, Mexico and Dominican Republic.
Our suppliers provide raw materials (e.g. chemicals, adhesives, films, PVC compounds etc.), part finished products (e.g. moulded items), finished products (e.g. primary and secondary packaging), services (e.g. sterilisation) and research and development support. Some elements of our supply are concentrated with a small number of suppliers. For example, in 2020, approximately 80% of our contract manufacture was with nine suppliers and three suppliers represented approximately 70% of our logistics spend. Other categories are more evenly distributed, with 34 suppliers representing approximately 80% of our raw material purchasing.
OUR POLICIES ON SLAVERY AND HUMAN TRAFFICKING
We implement a number of policies and codes which are relevant to slavery, people trafficking, and human rights and ethical behaviour more broadly. We publish these policies and codes on our website and they can be viewed here.
Our Human Rights and Labour Standards Policy (“Policy”), which applies to our own operations and employees, specifically addresses the United Nations Universal Declaration on Human Rights, the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work and the Ten Principles of the United Nations Global Compact. The Policy clearly states that “ConvaTec does not accept nor condone any form of modern slavery whether forced, compulsory or trafficked labour. Without limitation, ConvaTec does not engage sweatshop labour, convict labour or indentured labour under penal sanction.”
The Policy is referenced in our Code of Ethics and Business Conduct (“Code”) which defines out core principles of ethical business practice and our standards for professional and personal behaviour. The Code includes sections on human rights, discrimination and harassment.
Every ConvaTec employee is required to report any actual or potential violation of either the Policy or the Code and communication channels are in place within the Group to facilitate and encourage such reporting, including an independently-managed Compliance Helpline (whistleblowing facility - see below).
Our Supplier Code of Conduct (“Supplier Code”) addresses issues of human rights and the prohibition of child labour, compulsory labour and human trafficking. All new Direct and Contract Manufacturing suppliers are required to sign our Supplier Code, and since its publication in 2016, our existing suppliers are required to sign it as and when their contracts are renewed.
In many countries we conduct our business via third party distributors. We evaluate third party distributors prior to engagement and require that our distributors comply with all applicable laws and regulations and our Global Third Party Compliance Manual. In 2021, we will expand the scope of our due diligence process to include other third parties (including wholesalers and GPOs) that provide us with services and may also interact with government entities and healthcare professionals.
In 2021, we intend to re-establish our cross-functional Human Rights Steering Committee following the disruption during 2020 caused by the Covid-19 pandemic. The Steering Committee will continue to oversee policy matters relating to human rights. The committee includes representatives from our Supply Chain, Supplier Quality, Legal and Human Resources teams.
We regularly review our policies and codes which are relevant to slavery, people trafficking, and human rights and ethical behaviour. In particular, during 2020 we reviewed and updated our Code and during 2021 we will review and update our human rights-related policies.
RISK ASSESSMENT AND DUE DILIGENCE PROCESSES FOR SLAVERY AND HUMAN TRAFFICKING
We believe the risk of slavery and trafficking in our own operations to be very low.
We evaluate our prospective suppliers using a business review process that focuses on the quality of the product manufactured, the standard of documentation in place and other performance indicators. We also carry out cyclical quality audits assessing compliance with relevant regulations. As highlighted above all new Direct material and Contract Manufacturing suppliers receive and are required to sign our Supplier Code.
During 2020 in person Risk Assessments were not possible due to the lockdown restrictions in place in all geographies, in addition to a corporate travel ban being in place. The Risk Methods and EcoVadis platforms continue to be utilised as the main resource in our Risk Assessment activities during this period.
Our approach to human rights within our own operations and within our supply chain is assessed regularly by one of our key customers, the UK National Health Service (“NHS”), using its Labour Standards Assurance System (“LSAS”) which outlines the principles and guidelines the NHS requires it suppliers to comply with to ensure good labour standards are driven throughout its supply chain. Assessments relate to particular product category tenders, and cover all the aspects of a management system approach to human rights, including topics such as roles and responsibilities, policy, communication and awareness, risk assessment, operational control and training.
SUPPLIER ADHERENCE TO OUR VALUES AND ETHICS
Currently we use the following mechanisms to evaluate our suppliers and ensure their adherence to our values and ethics:
Third-party supplier assessment
To support our internal assessment of suppliers against our Supplier Code, we operate a process managed by a third-party provider. This process includes an evidence-based assessment which follows existing best practice and codes. Furthermore, it is based on a comprehensive set of ethics, labour rights, health and safety, and environmental criteria which are closely aligned with our Supplier Code. Each assessment is tailored to fit the size, sector and geography of the individual supplier and cover issues including: health and safety, working conditions, child and forced labour, discrimination, energy and greenhouse gas emissions, water and waste management, use of chemicals, local pollution, corruption and bribery, information management, and the supplier’s own supply chain assessment processes.
Certification – Supplier Agreements
We require our Direct Material and Contract Manufacturing suppliers to comply with the laws of the country in which they operate. To help ensure our suppliers respect and enforce our standards with regard to anti-slavery and human trafficking our template supplier agreement includes the following clause:
”Supplier represents, warrants and covenants that (i) it complies with all applicable laws on working hours and employment rights in the countries in which it operates; (ii) the evaluation and treatment of its employees and applicants for employment are free from discrimination and harassment, whether such discrimination or harassment is based on sex, age, race, colour, ancestry, religion, belief, disability, sexual orientation or marital status; (iii) the Products supplied under this Agreement shall be manufactured under conditions in compliance with the principles set out in the International Labour Organization Eight Fundamental Conventions nos. 29, 87, 98, 100, 105, 111, 138 and 182 and in the United Nations Convention of the Rights of the Child Article 32; and (iv) no Products have been made in whole or in part by sweatshop labour, convict labour or indentured labour under penal sanction.“
This clause is included in all new supplier agreements and is being phased into existing suppliers’ agreements as and when their contracts are renewed.
In accordance with our Supplier Code, we are entitled to perform various types of audit assessments to verify the current state of supplier compliance and undertake routine monitoring of the supplier’s on-going compliance. If a supplier fails to comply with our Supplier Code, we can either put in place a remediation plan or, in cases of severe non-compliance, refuse to pursue or terminate an existing relationship.
At the end of 2020, these processes did not reveal any issues that warrant an “onsite” audit focused on trafficking and modern slavery to be conducted.
Open Communication and Whistleblowing
We are committed to fostering a work environment where open, honest communications are the expectation, not the exception. We encourage our employees to approach their supervisor or management in instances where they believe violations of policies or standards may have occurred, including in relation to trafficking or slavery issues. We also encourage them to ask if they require guidance about any of our policies and procedures.
In situations where our employees or any third-party prefers to place a report in confidence, we provide access to an independent Compliance Helpline, hosted by a third-party provider. This Compliance Helpline is available via our internal and external websites. Where there may be restrictions on confidential or anonymous employee reporting, employees are also directed to an internal confidential ConvaTec resource to help review and resolve any reports of concern. This would include issues relating to trafficking and slavery.
We provide mandatory training in relation to our Code for all new and existing employees on an annual basis. This training is delivered through online training, via “Town Hall” meetings and in virtual or face-to-face sessions. As part of our management induction process new members of our management team participate in training in relation to our Policy.
We believe our policies, training and procedures are effective in reducing the risk of slavery and human trafficking taking place within our own business. To date we have not received any reports of these activities.
In relation to our supply chains, the audit assessment processes we operate have not revealed any issues that warrant an “onsite” audit focused on trafficking and modern slavery to be conducted. As highlighted above, we are taking steps to re-invigorate our existing third-party led supplier assessment process. Despite the slower than hoped for progress, we have not received any reports of slavery or people trafficking in our supply chain to date.
SUMMARY OF SPECIFIC ACTIONS TAKEN IN 2020
This statement has been approved by the Board of Directors of ConvaTec Group Plc and is signed by the director responsible for ensuring compliance with the Modern Slavery Act 2015.
Signed by Karim Bitar, Chief Executive Officer, ConvaTec Group Plc, on 7 May 2021
Published on 12 May, 2021.